The central bank has asked the National Payments Corporation of India to develop a facility that would allow customers using RTGS and NEFT to verify the name of the bank account to which money is being sent.
RBI Rule: The Reserve Bank of India (RBI) has taken steps to prevent irregularities in online money transfer. Under this, the central bank has asked the National Payment Corporation of India to develop a facility that allows customers using RTGS and NEFT to verify the name of the bank account to which the money is being sent. This system will come into effect from April 1, 2025.
The Reserve Bank said in a circular on Monday that all banks directly or indirectly associated with the ‘Real Time Gross Settlement’ (RTGS) i.e. real-time payment system and ‘National Electronic Fund Transfer’ (NEFT) system are advised to provide this facility before April 1, 2025. Currently, those sending money under the Unified Payment Interface (UPI) and Immediate Payment Service (IMPS) system have the facility to verify the name of the beneficiary before starting the process.
RBI has decided to set up a similar facility. This will allow the sender to verify the name of the beneficiary’s bank account before initiating a transaction using RTGS or NEFT system. RBI has advised the National Payment Corporation of India (NPCI) to develop this facility and include all banks in it. It has been said that the banks which are participants of RTGS and NEFT system will provide this facility to their customers through internet banking and mobile banking.
This facility will also be available to individuals visiting bank branches to make transactions. The central bank’s circular states that the aim of this initiative is to curb irregularities and fraud for those sending money using RTGS and NEFT systems. Under this system, there will be a facility to verify the name of the bank account in which the money is being transferred before starting the process of sending money.
This will curb errors and fraud. Through this facility, the name of the beneficiary account will be obtained from the bank’s ‘Core Banking Solution’ (CBS) on the basis of the beneficiary’s account number and IFSC entered by the sender of the money. It says, “The beneficiary account name provided by the beneficiary bank will be shown to the sender. If for any reason the beneficiary’s name cannot be displayed, the sender can take steps to send the money at his discretion. “RBI said that NPCI will not keep any data related to this facility. In case of a dispute, the remitting bank and the beneficiary bank will resolve the matter based on the ‘lookup’ reference number and the respective ‘log’. Customers will not have to pay any fee for the facility to look up the beneficiary account name without any charge.
